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Filecoin (FIL) has risen from $3 in the past three weeks and is currently trading at $3.3. It encountered selling pressure below the $3.5 resistance zone and volume indicators showed weakening bulls.
Filecoin Price Prediction
Previous higher time frame analysis of Filecoin highlighted the long-term downtrend and suggested a possible drop below $3. However, there was an upward movement in the cryptocurrency, retesting the $3.45 level just below another high timeframe resistance zone.
The market structure was in an upward trend last week, but the drop below $3.3 on October 3 shifted the structure towards a decline. Additionally, the relative strength index (RSI) fell below the neutral 50 level. Along with the metric, this could indicate a continuation of FIL’s decline.
The mentioned situation is supported by on-balance volume (OBV), which has been in a steady downtrend since the end of August, according to experts. Even when Filecoin rose from $3 to $3.45, OBV did not show a significant increase that would reverse the previous trend.
What are the Expectations for FIL?
At the time of writing, OBV continued to decline. Therefore, it is possible for FIL to experience a further decline. It is noted that a short position is possible, and the probability of success may increase if FIL prices retest the $3.5 drop order block on the 1-day chart. The open interest (OI) chart showed a rapid decline after the price dropped to $3.45 on October 2. The conclusion drawn was that market sentiment was bearish and long positions were discouraged.
However, the spot cumulative volume delta (CVD) chart, like OBV, also experienced a decline last week. Despite the recent surge in Bitcoin (BTC) prices, in which other altcoins performed well, CVD strengthened the idea that Filecoin is lacking significant demand. Therefore, buying FIL in the coming days may be risky.
